As you can probably tell, I am starting to have a few regrets about buying a house. I love my home but, bloody hell, is home ownership overrated. First of all, it’s not as though I even really own the thing, is it? I’m basically just renting it from the bank. And, unlike a landlord, the bank doesn’t come over to check on your possibly frozen pipes. “But instead of throwing money away on rent you’re building equity! Homes are a great investment!”, people might say. Well, yes, that’s true – just as long as you buy in the right place at the right time and are able to hold on to it for the right number of years and sell at the right moment. If you can do all that then you’re grand. If you can’t, then real estate can be a very iffy investment.
….
Instead, I realised that home ownership is just a never-ending series of expensive things that need to be done.
Well, yes, so landlords earn their money, don’t they? Alleviating you of that price and maintenance risk?
“First of all, it’s not as though I even really own the thing, is it? I’m basically just renting it from the bank.”
Yes, that bloke up a ladder clearing your gutters is a bank manager. He’ll unblock your toilet for his next job.
Pay off the mortgage and you will own the property, unless it is a leasehold property.
I do agree with the point about making money though. If you have a mortgage then you will be paying interest and that will affect how much profit you actually make. Whilst most people will make a capital gain when they sell it is questionable if they actually make a profit given the interest they will have paid, renovation costs and other general maintenance.
Of course trying to explain that to people can be difficult. Most people are confused by the difference in capital gains and profits.
Isn’t the rule of thumb that one spends on average 2% of a house’s value in maintenance per year? It tends to be lumpy so if you move a lot you might get away without doing major maintenance but that probably reflects in the selling price.
You can only make a profit from selling a house if you don’t then buy another house. So then where do you live?
Arthur: I budget 10% for maintainance and 10% for reserves. I would have to do some research to compare that against actual figures as, as you say, it’s very lumpy from year to year, but it feels right.
Sorry, that’s 10% of revenue not 10% of value.
“But my whole point here is that buying a house shouldn’t be a privilege. Shelter is a human necessity and yet we’ve turned housing into a speculative commodity.”
Someone who doesn’t understand their own personal finances shouldn’t really be opining on the whole system. “I can’t understand mortgages, so let’s have a full on fucking Marxist revolution!”
“But my whole point here is that buying a house shouldn’t be a privilege. Shelter is a human necessity and yet we’ve turned housing into a speculative commodity.”
Shelter has always been speculative since we thought it a good idea to start using caves…
The speculation used to be to keep that shelter safe yourself against predators ( different species or our own..), then it became speculation against the opinion/mood of the current head of the mob with might and “right” on their side to maintain that safety, then things became Bureaucratic and “Civilised” where you used tokens of exchange to Appease the Mob in Power to more or less ignore you as long as that Appeasement continued.
The method of speculation has changed, but the need to speculate has never gone away..
She’s basically complaining that she can’t cope with being an adult.
For a bloke, the great joy of owning a house is to see how much of the place one can bugger up doing DIY and then proudly showing it iff to approving matex.
Almost right Ottokring, the best part of being the owner is being able to show the missus how *functional* your repairs are.
“Look, light in the bathroom you asked for!”
“What’s this hole in the wall?”
“Electrical cord had to get there somehow”
jgh; “You can only make a profit from selling a house if you don’t then buy another house. So then where do you live?”
Well, you buy a cheaper house, downsizing, usually around retirement age once you no longer need to be close to economic centres, but you could do it earlier, once you’ve got rid of the kids.
Thing is, I strongly suspect that downsizing has pretty much come to a halt, due to the cost of adult social care, which means reduced liquidity in the housing market, driving prices up for those actually coming onto the market.
@jgh
The big “win” out of the property game comes when you get married to someone else who also owns a house, as then you only need one house between you, and you get to sell the other without buying a replacement.
I got married last year, aged 35… I went from having 10 years left on my mortgage, and just about paying the bills to being part of a couple with our mortgage paid off, a substantial nest egg, and a bit over twice our current monthly expenditure arriving in the bank every month – and our assets and income were broadly equal prior to marriage.
Obviously, this only works if one can be fairly confident of avoiding divorce, otherwise any “gains” are likely to be more than lost again!
Thank you Otto and Ltw. I didn’t know anyone else was as bad as me!!
“There is immense pressure to buy a place…” – from whom, dearheart? Unless it’s the FBI pointing guns at you, why should you care?
“to do so is obviously a massive privilege”: is it possible to know with any precision what Guardianistas mean by “privilege”? Sometimes they mean “rich”. Occasionally they actually mean “privilege” – as in having a seat in the House of Lords. But what else do they mean?
Adult responsibility “too much” for 40 year old Guardianista with strong opinions on how you should live your life.
Idiots.
1. A mortgage is not ‘renting it from the bank’.
2. The landlord owns the property and thus has an interest in ensuring it’s maintained in a way tenants do not. You’re the owner now.
3. Is it really that hard to deal with maintaining a home over there? I live with a well and septic and have had to arrange for maintenance for them both several times – not a big deal to call someone in to pull the pump when the water goes out.
I live with a well and septic and have had to arrange for maintenance for them both several times
I feel your pain. Living with a septic seems to be a high maintenance affair, judging by Prince Harry.
“to do so is obviously a massive privilege”:
Owning a house is a symbol of white supremacy and sublimating your forebears owning slaves, dearieme. Do keep up.
“But my whole point here is that buying a house shouldn’t be a privilege.”
Guardian Turns Thatcherite Shock!
A rule I’ve always followed is never own the property one lives in. What one buys for investment is what other people want to live in.
Steve
“I feel your pain. Living with a septic seems to be a high maintenance affair, judging by Prince Harry.”
boom boom!